World Bank Mobilizes $1.5B to Support South African Infrastructure

South Africa has secured a $1.5 billion loan from international financial institution the World Bank to strengthen its energy and freight transport infrastructure, with a focus on inclusive economic growth and job creation. The funding will support three priority areas outlined by the South African government, including improving energy security by attracting new investments for energy transmission, energy access and municipal energy distribution projects.

In addition to energy projects, South Africa will use the funding to improve the efficiency of the freight transport sector. The country will establish an independent transport regulator and streamline the operations of the state-owned enterprise Transnet as part of this effort. Additionally, the loan will aid in modernizing the country’s fiscal frameworks to encourage private investment in the transition to a low-carbon economy.

“This loan represents another important milestone in our government’s commitment to transforming South Africa’s infrastructure into a more efficient, competitive and sustainable foundation for growth,” stated Enoch Godongwana, Minister of Finance, South Africa.

The funding is part of the World Bank’s broader support for structural reforms in South Africa, which are expected to create 250,000 jobs by 2027 and up to 500,000 by the early 2030s.